BCBS of North Carolina sues feds over risk corridor payments

Blue Cross Blue Shield of North Carolina (BCBSNC) is suing the federal government for more than $147 million in risk corridor payments that never materialized, making it the second insurer to file such a claim in the past month.

The BCBSNC lawsuit comes nearly two weeks after Pittsburgh-based Highmark sued the federal government for failing to make $223 million in risk corridor payments. Shortly after filing the lawsuit, Highmark CEO David Holmberg said leaders at other health insurers were weighing their own options to recoup payments. A similar lawsuit filed in February by Health Republic Insurance of Oregon is seeking class-action status.

BCBSNC claims that the government sidestepped the requirements of the risk corridor program designed to mitigate the costs of high-risk beneficiaries flooding the Affordable Care Act marketplaces. To date, the government has paid just 12.6 percent of the total amount due from 2014 alone. If a court rules that the government failed to make timely payments, BCBSNC will seek additional relief for 2015 and 2016 payments.

Given the shortfalls in the risk corridor program, the Centers for Medicare & Medicaid Services has tried to look for other sources of funding. BCBSNC reported a loss of more than $400 million on ACA policies in 2014 and 2015.

To learn more:
- read the BCBSNC complaint

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